From CNBC: 2024-10-24 16:24:41

Southwest Airlines and activist hedge fund Elliott Investment Management have reached a compromise to avoid a proxy fight by appointing six new directors to the airline’s board, including former Chevron CFO Pierre Breber. Executive Chairman Gary Kelly will retire early, and CEO Bob Jordan will remain in his role. Elliott had criticized Southwest’s leadership for not innovating, leading to stagnant stock prices compared to competitors like Delta Air Lines. Southwest’s third-quarter profit exceeded expectations, but shares dropped by 6% midday. The airline aims to improve earnings through cost-cutting initiatives and revenue strategies. Earlier plans to reduce the board to 12 members have been revised, and Kelly will step down earlier than expected. The deal marks the largest board change driven by Elliott in a U.S. corporate battle. Both Kelly and Jordan have decades-long careers at Southwest, with Kelly expressing confidence in Jordan’s leadership.



Read more at CNBC: Southwest, Elliott strike deal to keep CEO Jordan, add six directors